Yahoo advanced 2.4 percent on news it will still seek a sale of its Alibaba holdings. The technology company said it would pursue the transaction despite not getting a guarantee that US tax officials would permit the transaction to qualify as tax-free.

Dow member McDonald's rose 1.6 percent following an upgrade from Credit Suisse, which said the fast-food giant's sales outlook is starting to improve after a run of disappointing results.

Dow member Johnson & Johnson advanced 1.8 percent following an upgrade from Deutsche Bank, which predicted strong growth ahead for its pharmaceutical business.

Bond prices rose. The yield on the 10-year US Treasury fell to 2.06 percent from 2.10 percent Monday, while the 30-year dipped to 2.86 percent from 2.88 percent. Bond prices and yields move inversely.